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Cary Increases the Price of Her Cakes from $8 to $10

Question 48

Multiple Choice

Cary increases the price of her cakes from $8 to $10 per cake, but her cash receipts decrease by 2 percent. The price elasticity of demand (in the $8 to $10 range) is


A) elastic.
B) inelastic.
C) 0.02.
D) 0.25.

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